Town Finances: Healthy And Getting Healthier

By: Ed Maroney

Topics: Municipal Finance , Orleans news

Tony Roselli, managing partner of the town's audit firm Roselli, Clark & Associates, listens as Cathy Doane, the town's finance director, reports on responses to his recent findings.  ED MARONEY PHOTO

ORLEANS With significant borrowing for capital projects on the horizon, there was good news for the town from its independent auditor last week.

Tony Roselli, managing partner of Roselli, Clark & Associates, said a recent audit and a conversation with Standard & Poor's indicated that the town would maintain its top-rank AAA bond rating. “You've managed to increase your reserves the last three years,” he said, The town has also been putting money into its OPEB (Other Postemployment Benefits) obligations, which S&P “likes to see,” Roselli said.

“The town has always done very well financially,” the auditor said before delving into specific findings intended to maintain and improve that status. Many of these concerns grew out of former practices that Finance Director Cathy Doane, since her arrival last year, has been working to address.

For example, Roselli found that the town had not billed the state School Building Authority in a timely manner for reimbursement for work at Orleans Elementary School. Doane said the billing was now up to date, with the town receiving 95 percent of the $380,000 due it (5 percent is held in reserve until a final audit of the project). “I have provisions in place to prevent this” in the future, she said.

Roselli said that ambulance fee receivables “look like they're going higher and higher,” with about $250,000 outstanding for more than 180 days. “It appears to have a lot to do with how collectibles are written off,” Doane said. She plans to meet with Fire Chief Anthony Pike to address the issue.

“It's a little disconcerting to see over 50 percent over 180 days old,” Selectman Jon Fuller said. “We spent some money on a reporting system to prevent this.”

Regarding police details, Roselli noted that the town pays its officers and then runs a deficit while it waits for reimbursement from those contracting services. Doane said Police Chief Scott MacDonald and she “have identified approximately $30,000 in outstanding details owed to the town, some back to 2011.” She said some of that will have to be written off.

Other audit recommendations included reducing the use of manual ledgers for receivables. “It might be time to bring in some automation,” Roselli said. Doane said the treasurer's staff “has been diligent and open to doing things a new way. We'll all be automated by year's end.”

Cash handling has been a recurring concern. Following her arrival last year, Doane said, cash is accepted only at the treasurer's office. “It's not without pain,” she said. “There have been complaints by residents and contractors, [but] it centralizes our collection activity.” In coming months, she'll meet with departments outside town hall about extending the policy.

After his overall review of town finances, Roselli zeroed in one of the “large revenue producers,” the Council on Aging. “Major improvements were noted,” he said. “I was very pleased with what happened here. [COA Director] Judi Wilson really took the bull by the horns.”

Recommendations to improve cash handling practices led to creation of pre-paid voucher punch cards good for 10 activities. Roselli said he'd like to see the cards numbered for better control, and Wilson came up to the podium to say the unnumbered cards have been destroyed and replaced.

Although the auditor said he hoped every transaction could include a receipt, Wilson noted that many payments are received by mail and that mailing receipts would generate additional costs.

Other recommendations included introducing on-line registration, changing the locks, and adding some surveillance. The last item raised eyebrows. “You attract guests from the court?” Selectman Alan McClennen asked. “I don't know if they send them,” Wilson said. “They do find us. We have some foot traffic from the courts.”

Selectman David Dunford, the board's liaison to the COA, congratulated Roselli and Wilson for an “excellent plan” and complimented Wilson for “tremendous follow-up.” “I have an exceptional officer manger and a great clerk as well,” she said.